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Knutsford
5th Jun 2006, 02:34
Cathay Pacific is expected to buy out its 17.8 percent-owned subsidiary Dragon Airlines for at least HK$10 billion to establish a firmer foothold in the fast- growing mainland aviation market, sources said.

Monday, June 05, 2006

Cathay Pacific is expected to buy out its 17.8 percent-owned subsidiary Dragon Airlines for at least HK$10 billion to establish a firmer foothold in the fast- growing mainland aviation market, sources said.
Cathay is understood to be in advanced stages of the discussions, first started in 2004, with Dragonair parent China National Aviation Company to simplify its shareholding in the mainland-owned carrier, a senior source close to the talks told The Standard.
The long-contemplated move may also involve revamping the shareholding structures of major players in the regional aviation sector, including Cathay Pacific, CNAC, Air China and CITIC Pacific.
Cathay Pacific is expected to buy out the stakes held in Dragonair by Swire Pacific, CITIC Pacific and CNAC through a combination of cash and share issues.
A Citigroup report out last month estimated Dragonair to be worth about HK$12.2 billion. Cathay would have to pay HK$3.2 billion for CITIC Pacific's entire 28.5 percent stake in Dragonair, the report said.
A source confirmed that Air China was likely to acquire shares in Cathay Pacific, becoming its third-largest shareholder after Swire Pacific and CITIC Pacific.
Cathay Pacific already holds a 10 percent stake in Air China and the cross shareholding is expected to strengthen ties between the two carriers, helping the mainland-based airline to gain valuable management expertise for competing more effectively in the international market.
CITIC Pacific, which currently owns 25.42 percent of Cathay Pacific, is likely to cut its stake in the carrier.
Earlier this year, the conglomerate said it wanted to trim shareholdings in its non-core businesses and focus on the property and resources sectors.
A recent report issued by CITIC Capital, a unit of the CITIC Group, said any alliance between Cathay Pacific, Air China and Dragonair could be a compelling force in the global aviation market as it would create vast synergies in resource utilization and routes.
The three carriers could form a "triangular cooperative platform" implementing a cohesive domestic, regional and international strategy, the report said. Dragonair flies to 23 destinations in the mainland from Hong Kong.
Cathay Pacific, despite years of trying, has so far managed to secure routes only to Beijing and Xiamen.
The lucrative Hong Kong-Shanghai route has eluded the carrier and, even on the Hong Kong-Beijing route, Dragonair accounts for 88 percent of the flights.
In the past, the tussle for mainland routes between Cathay Pacific and Dragonair turned bitter, with one or both sides threatening arbitration.
Total ownership of Dragonair would make Cathay the top foreign carrier operating in the mainland, far ahead of Japan Airlines, Singapore Airlines and Korean Air, which only have limited access to Chinese skies. "Clearly, Cathay would benefit from controlling Dragonair as it could cut competition and allow Cathay to fully utilize Dragonair as a feeder airline," HSBC's regional transport analyst Mark Webb said in a recent report.
Dragonair's net profits accounted for 52 percent of CNAC's total income last year.

CNAC<01110> - Suspension of Trading

At the request of China National Aviation Company Limited, trading in its
shares has been suspended with effect from 9:31 a.m. today (5/6/2006)
pending announcements of certain notifiable and/or connected transactions
of a price sensitive nature.

AIR CHINA<00753> - Suspension of Trading

At the request of Air China Limited, trading in its H shares has been
suspended with effect from 9:31 a.m. today (5/6/2006) pending
announcements of certain notifiable and/or connected transactions of a
price sensitive nature.

akerosid
5th Jun 2006, 04:35
This probably complements the rumour about Air China Cargo, China Cargo and Dragonair Cargo, which was going around recently (see post below); CX will be taking over the pax operations (subject of course to the announcement).

Nice to see A320/321s in CX colours; these will be the first narrowbodies CX has operated since the old 707s were phased out 20 years ago.

CX will also be the biggest operator, by a considerable distance, of A330s, with KA's 15 (+1 on order) joining CX's 330s (26, +3 on order).

Hopefully it will be a pleasant transition for all involved.

CAPT146
5th Jun 2006, 05:04
There would be no changes in the Dragonair colours. Dragonair is a big name in mainland China and well respected. Dragonair still will have all the rights to fly to its china destinations.

jtr
5th Jun 2006, 06:48
HONG KONG, China (Reuters) -- Hong Kong's main airline, Cathay Pacific Airways Ltd., is expected to announce a takeover of China-focused rival Dragonair in a deal reported to be worth $1.3 billion, sources familiar with the matter said.

The long-anticipated buyout would make Cathay Asia's biggest carrier and provide it with the profitable routes to mainland China it has long sought.

http://edition.cnn.com/2006/BUSINESS/06/04/cathay.dragonair.reut/

fire wall
5th Jun 2006, 06:55
Capt Quadra-puff, such a definitive statement. We all have no idea how this is going to pan out until the respective heads of depts brief the troops...and on past performances even then it will probably change. Must be difficult being the repository of all knowledge. Best do what you do best....fly the bloody a/c and let the managers do the managing (sic) .... yeah small attempt at humour.

jtr
5th Jun 2006, 07:06
Steady fire wall, Capt Q has been in KA for a year now.

TruBlu351
5th Jun 2006, 08:10
So how exactly will the takeover get more "CX" jets into mainland China (in addition to Dragon Air's current market share)?

I understand China is one of the fastest growing markets at the moment and has room to grow, but I assume CX jets will still need Chinese government approval? or will CX fall under the KA approval umbrella?

Elroy Jettson
5th Jun 2006, 08:14
12 months? That would make you a pretty senior captain up there these days wouldn't it? :}

CAPT146
5th Jun 2006, 08:54
Forgive me I thought this was the rumour network. My mistake.

Kitsune
5th Jun 2006, 10:18
Now now girls, no handbags...:cool:

Dan Winterland
5th Jun 2006, 13:04
If CX do buy KA, it will be at a price. It's more likely we will see all three fleets with a Phoenix on the tail before KA's fleet is painted green!

Feather Boa
5th Jun 2006, 13:59
Aeroskid and Firewall it will be a pleasure to join you (to what extent we join, who knows).
Unfortunately we'll also be associated with the likes of jtr and ellroy.
I'm sure us inexperienced Captains from our little pisspot operation across the road will gain immeasurable experience from operating with you both....

Fx

Re-entry
5th Jun 2006, 18:49
Steady on there. It might be in ALL our long term interest. Although most such 'mergers' usually favour only the top management of the winning company, HKG is different actually.

hog tied
5th Jun 2006, 22:26
This would surely mean a big raise for all!

Re-entry
6th Jun 2006, 01:58
This would surely mean a big raise for all!
Indeed . PC et al.

And Then
6th Jun 2006, 02:52
12 months? That would make you a pretty senior captain up there these days wouldn't it? :}

FWIW(not much) recent KA command check outs involve guys with 5 to 10 thousand hours on type. :}

BuzzBox
6th Jun 2006, 04:56
According to the front page of today's SCMP:

"Dragonair buyout package to be unveiled tomorrow"

Elroy Jettson
6th Jun 2006, 06:30
Feather Boa! Are we associated? :uhoh:

Why is noting an enviably short time to command derogitory? Everyone knows they dont give commands away up there... Far from it...

Back to the topic

Might be interesting to watch the dynamics of jetstar int/Australian Airlines wet lease and QF mainline to see what having a cheaper model available to management does to CX... At best it puts pay rises on hold until parity is achieved, at worst, all the expansion goes to the group with the lowest costs. Interesting times ahead.

Also the way QF integrated the two pilot groups, QF and TAA may be interesting reading for your associations.

Good luck to all, interesting times ahead. :)

Goonybird
6th Jun 2006, 18:21
Somebody will have to pay for this purchase and it won't be the Swire's. Employees please bend over, one ungreased bat is headed your way!:ugh:

spannersatcx
6th Jun 2006, 18:59
again!:ouch:

Night Watch
7th Jun 2006, 04:42
So.... thoughts... opinions?

Keep them separate or bring out the green paint?

I personally think they will keep the 2 separate, although I don't see to many problems from the pilot side of things if they do amalgamate the two (both are grownig rapidly). I know KA friends of mine wouldn't mind the later and the KA management lay offs that would result.

BuzzBox
7th Jun 2006, 04:52
I personally think they will keep the 2 separate

Yep, I tend to agree. Perhaps CX will nick some of the better slots into Beijing and Shanghai to boost their services to the mainland. There might also be some tinkering to align schedules through HK, but I tend to think they'll leave the rest alone, for the time being at least. I guess they'll also 'rationalise' some management positions to cut-out any unnecessary duplication.

JY9024
7th Jun 2006, 11:59
So much for the big announcement today.
Another case of journalistic Bullshirt.....

Sqwak7700
8th Jun 2006, 09:33
MAybe someone at CX-city dropped the ball, and the announcement was the 2 777s order. Lines of communications got crossed, and the tail wagged the dog. :ooh:

They did suspend trading before the big order announcement a few months back. I know it doesn't compare, but could it be? I didn't check, but is trading still suspended for CX on the HK market?? :confused:

7FF
8th Jun 2006, 09:54
As of 1750, 8 June the shares are still suspended.
They usually make announcements on a Friday. Gives the 'boys/girls' time to get over whatever they intend to slip you by office hours on the following Monday.:cool:

betaboy
8th Jun 2006, 14:51
Cathay to Double Air China Holding
http://www.thestandard.com.hk/news_detail.asp?pp_cat=2&art_id=20383&sid=8305640&con_type=3

The Dragon that was too hot to handle
http://www.thestandard.com.hk/news_detail.asp?pp_cat=1&art_id=20377&sid=8309178&con_type=1

Still nothing official about Dragon.

Baywatcher
8th Jun 2006, 15:42
Cathay Pacific to take over Dragonair
By Justine Lau and Tom Mitchell in Hong Kong
Published: June 5 2006 10:05 | Last updated: June 5 2006 22:33

Cathay Pacific is set to take over Dragonair, its smaller rival, in a long-awaited deal that will give Hong Kong’s de facto flag carrier much wider access to China’s tightly-regulated skies.
In return, Air China, the country’s national carrier and Dragonair’s largest shareholder, will gain a stake in Cathay, according to people close to the negotiations.
The transaction, expected to be announced this week, will help to clear the complex shareholding structure between the three airlines and their parent companies, which have been in restructuring talks for months.
The deal will give Cathay a strong boost as the carrier has been attempting for years to expand its presence in China’s fast-growing aviation market. Cathay pulled out of the mainland market in 1990 after buying a stake in Dragonair, which mainly flies between Hong Kong and China.
Cathay returned to China in 2003 but still only flies passengers to two mainland cities – Beijing and Xiamen in south-east China.
Dragonair, meanwhile, has been expanding rapidly and serves 23 mainland destinations – more than any other non-Chinese airline. It is also highly profitable.
Analysts said there was a compelling strategic argument for Cathay to take over Dragonair and create one of the strongest networks in Asia.
The skies are clearing around Cathay Pacific. The Hong Kong airline has weathered more storms than most.
Although the benefits to Air China seem less obvious, analysts said the deal would help the country cement its relationship with Cathay, which has a 10 per cent stake in the Chinese carrier, as it seeks to become a more serious player in the international aviation market.
Air China will also profit from its stake in the merged Cathay/Dragonair, which is expected to be even better run and more efficient than the current Dragonair.
According to a Hong Kong newspaper report, Cathay, which has a 17.8 per cent stake in the unlisted Dragonair, would pay at least HK$10bn (US$1.29bn) to buy out other shareholders in the airline.
Air China controls 43.3 per cent of Dragonair through a Hong Kong-listed subsidiary called China National Aviation Holding.
Citic Pacific, a Beijing-backed conglomerate, owns 25.4 per cent of Cathay and has a 28.5 per cent stake in Dragonair.
Swire Pacific, Cathay’s largest shareholder with a 46.4 per cent stake, also owns 7.7 per cent of Dragonair.
After the deal, Cathay will become sole owner of Dragonair, which is expected to maintain its brand.
Citic is expected to lower its stake in Cathay.
Shares in Cathay, Air China, Citic, Swire and CNAC were suspended from trading on Monday.
The companies declined to comment.

idg
9th Jun 2006, 00:42
From the CX 'Media Room'

Media Statement (12:30am)

The principals of the five parties involved in the proposed share realignment relating to Air China, Cathay Pacific, CNAC, CITIC Pacific and Swire Pacific met this evening at the Swire Pacific headquarters at Pacific Place Hong Kong to finalise details of the formal agreement relating to the deal. Those attending were the Chairman of Air China Mr. Li Jiaxiang, the Chairman of the China National Aviation Company Limited Mr. Kong Dong, the Chairman of Swire Pacific Limited Mr. Christopher Pratt, the Chairman of CITIC Pacific Limited Mr. Henry Fan and the Chief Executive of Cathay Pacific Airways Limited Mr. Philip Chen. A photograph of the principals involved is attached.

The press conference relating to the deal will be held at Atrium Room, 39/F, Island Shangri-la Hotel, Admiralty at 9:30 a.m. tomorrow (Friday, 9 June, 2006).

CAPT146
9th Jun 2006, 02:03
Swire Pacific Limited
(incorporated in Hong Kong with limited liability)
(Stock Codes: 19 and 87)
LISTING RULE 13.09 ANNOUNCEMENT

On 8 June 2006, Air China, Cathay, CNAC Limited, CITIC Pacific and SPAC
entered into a conditional agreement in relation to (i) the restructuring
of the parties' shareholdings in Cathay and Dragonair and (ii) the
acquisition by Cathay of additional shares in Air China. If the agreement
becomes unconditional, (1) Dragonair will become a wholly-owned subsidiary
of Cathay, (2) Air China will become a substantial shareholder of Cathay
and (3) Cathay will increase its shareholding in Air China.
Cathay has offered to acquire all the Dragonair Shares which it does not
already own for a total consideration of HK$8.22 billion (based on a
valuation of Dragonair of HK$10.00 billion or HK$20.00 per Dragonair
Share) to be satisfied by a combination of the issue of 548,045,724 new
Cathay Shares at an issue price of HK$13.50 per share and HK$0.82 billion
in cash.
Each of SPAC, CNAC Limited and CITIC Pacific has agreed to accept the
offer from Cathay to acquire their Dragonair Shares. To the extent that
any Dragonair Minority Shareholders do not accept the offer from Cathay to
acquire their Dragonair Shares, Cathay intends to exercise its powers
under section 168 of the Companies Ordinance (Cap.32 of the Laws of Hong
Kong) following completion of the Transaction to acquire compulsorily the
remaining Dragonair Shares from the relevant Dragonair Minority
Shareholders.
SPAC and CITIC Pacific have agreed to sell to Air China 40,128,292 and
359,170,636 Cathay Shares respectively. The consideration payable by Air
China for such Cathay Shares is HK$13.50 per share.
Cathay has agreed to subscribe in cash for 1,179,151,364 Air China H
Shares at an aggregate subscription price of HK$4.07 billion, representing
HK$3.45 per Air China H Share.
SPAC and CITIC Pacific have agreed to sell on or before Completion, such
number of Cathay Shares as will result in the percentage of Cathay Shares
held by them on Completion being 40% and 17.50% respectively and the percentage of Cathay Shares in public hands being not less than 25%.
Under the Restructuring Agreement, SPAC and CITIC Pacific have agreed to
recommend to the Cathay Board that as soon as practicable following
Completion and in any event, no later than 60 days following Completion,
Cathay will pay a special interim dividend of HK$0.32 per Cathay Share.
SPAC, CNAC Limited, CITIC Pacific and Air China have entered into a
shareholders agreement for the purpose of regulating their relationship
with each other as shareholders of Cathay and certain aspects of the
affairs of, and their shareholdings in, Cathay, following completion of
the Transaction.
Under the Shareholders Agreement:
(i) the parties have agreed that the Cathay Board will, subject to
adjustment in certain circumstances, consist of four non-executive
directors nominated by SPAC, two non-executive directors nominated by each
of CITIC Pacific and Air China, five executive directors nominated by SPAC
and four independent non-executive directors;
(ii) the parties have agreed to support, including by exercise (to the
extent permitted by law and the rules of the Exchange) of their respective
voting rights as shareholders of Cathay, the continuation and periodic
renewal of the existing management arrangements for Cathay and its
subsidiaries, including the services agreement between John Swire & Sons
(H.K.) Limited and Cathay, and their extension to Dragonair and its
subsidiaries substantially on their current terms; and
(iii) to support the implementation of the Operating Agreement and by
exercise (to the extent permitted by law and the rules of the Exchange) of
their respective voting rights as shareholders of Cathay, its continuation
and any periodic renewal of it.
In addition, the parties have agreed to the following in relation to their
shareholdings in Cathay:
(i) SPAC has agreed that the beneficial interest of SPAC and its group
in the Cathay Share Capital will not exceed 44.90% (49.90% if (i) CITIC
Pacific and its group or (ii) Air China and its group increase their
respective combined aggregate beneficial interest in the Cathay Share
Capital to above 22.45%), except with the prior written consent of the
other parties;
(ii) Each of (i) CITIC Pacific and (ii) Air China and CNAC Limited have
agreed that the combined aggregate beneficial interest of respectively
CITIC Pacific and its group and Air China and its group in the Cathay
Share Capital will not exceed 29.99%, except with the prior written
consent of the other parties; and
(iii) CITIC Pacific, Air China and CNAC Limited have agreed that, except
with the prior written consent of SPAC, their combined beneficial interest
in the Cathay Share Capital (including those of their groups ) will not
exceed 40% or the percentage beneficial interest of SPAC and its group in
the Cathay Share Capital (whichever is the lower).
(The undertakings by CITIC Pacific, Air China and CNAC Limited described
in paragraphs (ii) and (iii) above will cease to apply if SPAC (and/or its
group companies) disposes of Cathay Shares and as a result SPAC (together
with its group) is beneficially interested in less than 30% of the Cathay
Share Capital and Air China (together with its group) or CITIC Pacific (
together with its group) is beneficially interested (whether or not as a
result of such disposal by SPAC and/or its group companies) in more Cathay
Shares than SPAC (together with its group). The undertaking by CITIC
Pacific, Air China and CNAC Limited in paragraph (iii) above will also
cease to apply if SPAC (together with its group) is beneficially
interested in 44.50% or more of the Cathay Share Capital. The
undertakings by SPAC, CITIC Pacific, Air China and CNAC Limited described
above will cease to apply in favour of any shareholder which is a party to
the Shareholders Agreement whose beneficial interest in the Cathay Share
Capital (including that of its group) is less than 15%.)
The parties to the Shareholders Agreement have also agreed that so long as
a Shareholder is beneficially interested (together with its group) (
directly or indirectly) in 15% or more of the Cathay Share Capital, it
will not make a takeover offer for Cathay or accept a takeover offer from
a third party, unless that offer has been recommended by the Cathay Board.
Air China and Cathay have today also jointly announced that they have
entered into the Operating Agreement.
Based on the assumptions and reasoning set out below under the heading "
Regulatory and Listing Rule Implications":
Air China

* the acquisition by Air China of Cathay Shares from CITIC Pacific
constitutes a connected transaction for Air China and is subject to the
approval of the independent shareholders of Air China;
* the issue of Air China H Shares to Cathay constitutes a connected
transaction for Air China and is subject to the approval of the
independent shareholders of Air China;
* the sale of Dragonair Shares by CNAC Limited (as a subsidiary of Air
China) to Cathay and the acquisition of Cathay Shares by CNAC Limited (as
a subsidiary of Air China) from Cathay each constitutes a connected
transaction for Air China and is subject to the approval of the
independent shareholders of Air China;
* the acquisition of Cathay Shares by CNAC Limited (as a subsidiary of Air
China) from Cathay, when aggregated with the acquisition by Air China of
Cathay Shares from CITIC Pacific and SPAC, constitutes a major transaction
for Air China and is subject to the approval of the shareholders of Air
China;
* the issue of additional Air China H Shares to Cathay is subject to
approval by a special resolution of shareholders in general meeting of Air
China and approvals by special resolutions of shareholders at separate
class meetings of Air China in accordance with Air China's articles of
association and Rule 19A.38 of the Listing Rules;
Cathay
* the acquisition of Dragonair Shares by Cathay from SPAC and CITIC
Pacific constitutes a connected transaction and is subject to the approval

of the independent shareholders of Cathay;
* the allotment and issue of new Cathay Shares by Cathay to SPAC and CITIC
Pacific constitutes a connected transaction for Cathay and is subject to
the approval of the independent shareholders of Cathay;
* the acquisition of Dragonair Shares by Cathay from each of SPAC, CITIC
Pacific, CNAC Limited and the Dragonair Minority Shareholders, when
aggregated, constitutes a discloseable transaction for Cathay;
* the acquisition by Cathay of additional Air China H Shares constitutes a
discloseable transaction for Cathay;
* the proposed increase of the authorised share capital of Cathay from 3,
900,000,000 Cathay Shares to 5,000,000,000 Cathay Shares to facilitate the
Transaction is subject to the approval of the shareholders of Cathay;
* the allotment and issue by Cathay of new Cathay Shares to SPAC and CITIC
Pacific is subject to the approval of the shareholders of Cathay pursuant
to Rule 13.36(1)(a) of the Listing Rules;
CNAC Limited
* the sale by CNAC Limited of Dragonair Shares to Cathay in consideration
of Cathay issuing new Cathay Shares and paying HK$0.43 billion in cash to
CNAC Limited constitutes a very substantial disposal and a very
substantial acquisition for CNAC Limited and is therefore subject to the
approval of the shareholders of CNAC Limited;
CITIC Pacific
* the sale by CITIC Pacific of Dragonair Shares to Cathay constitutes a
connected transaction for CITIC Pacific and is subject to the approval of
the independent shareholders of CITIC Pacific;
* the sale by CITIC Pacific of Dragonair Shares to Cathay constitutes a
discloseable transaction for CITIC Pacific;
* the acquisition of new Cathay Shares by CITIC Pacific as consideration
for the Dragonair Shares constitutes a connected transaction for CITIC
Pacific and is subject to the approval of the independent shareholders of
CITIC Pacific;
* the acquisition by CITIC Pacific of new Cathay Shares as consideration
for the Dragonair Shares constitutes a discloseable transaction for CITIC
Pacific; and
* the sale by CITIC Pacific of Cathay Shares to Air China constitutes a
discloseable transaction for CITIC Pacific.
SPAC
* This joint announcement is made, in the case of SPAC, under Rule 13.09
of the Listing Rules.
A circular giving further details of the Transaction, the views of the
independent non-executive directors of Air China and independent financial
adviser to Air China, together with a notice of the Air China EGM will be
dispatched to shareholders of Air China as soon as practicable.
Details of the Transaction, to the extent they constitute connected
transactions for Air China, will also be included in Air China's next
annual report and accounts in accordance with Rule 14A.45 of the Listing
Rules.
A circular giving further details of the Transaction, the views of the
independent non-executive directors of Cathay and independent financial
adviser to Cathay, together with notice of the Cathay EGM will be
dispatched to shareholders of Cathay as soon as practicable.
Details of the Transaction, to the extent they constitute connected
transactions for Cathay, will also be included in Cathay's next annual
report and accounts in accordance with Rule 14A.45 of the Listing Rules.
A circular giving further details of the Transaction, the views of the
independent non-executive directors of CNAC Limited and independent
financial adviser to CNAC Limited, together with a notice of the CNAC
Limited EGM will be dispatched to shareholders of CNAC Limited as soon as
practicable.
A circular giving further details of the Transaction, the views of the
independent non-executive directors of CITIC Pacific and independent
financial adviser to CITIC Pacific, together with a notice of the CITIC
Pacific EGM will be dispatched to shareholders of CITIC Pacific as soon as
practicable.
Details of the Transaction, to the extent they constitute connected
transactions for CITIC Pacific, will also be included in CITIC Pacific's
next annual report and accounts in accordance with Rule 14A.45 of the
Listing Rules.
Conditional Undertaking and Request for Privatization of CNAC Limited
On Ling Investments Limited, which beneficially owns approximately 9.75%
of the issued share capital of CNAC Limited, has given a conditional
irrevocable undertaking to Air China and CNAC Limited to vote in favour of
the shareholders' resolutions to be proposed at CNAC Limited's
shareholders' meeting to approve the sale by CNAC Limited of Dragonair
Shares to Cathay and the acquisition of Cathay Shares by CNAC Limited as
described in this announcement. The conditions precedent to On Ling's
undertaking are:
(a) the publication of an announcement by or on behalf of Air China of
a privatization offer in cash for all the issued shares of CNAC Limited,
other than those already owned by Air China and parties acting in concert
with it, on terms no less favourable than HK$2.80 per CNAC Limited Share;
and
(b) the independent financial adviser to CNAC Limited's independent
board of directors committee is of the opinion that the terms of the sale
of the Dragonair Shares and the privatization referred to in paragraph (a)
above from a financial perspective are fair and reasonable.
Following receipt of the conditional undertaking from On Ling Investments
Limited, CNAC Limited Directors have requested Air China to privatize CNAC
Limited by way of a scheme of arrangement, on the basis that the offer
price will be HK$2.80 per CNAC Limited share. Air China is currently
considering the request by CNAC Limited Directors and is seeking the
appropriate PRC regulatory approvals and financing to proceed with the
privatization offer. Air China is currently also in the process of
formulating the proposals for the privatization offer and will issue an
announcement if and as soon as the proposals are finalized. As certain


and so on for another 10 pages

JY9024
9th Jun 2006, 02:10
HONG KONG, China (Reuters) -- Hong Kong's main airline Cathay Pacific Airways Ltd.said on Friday it will pay HK$8.22 billion ($1.05 billion) in cash and shares to take over rival Hong Kong Dragon Airlines Ltd.
The long-expected deal will expand Cathay's access to the fast-growing mainland China aviation market.
As part of the deal, Cathay will also pay HK$4.07 billion ($522 million) to double its stake in Beijing-controlled Air China Ltd. from 10 percent to 20 percent.
In turn, Air China will pay HK$5.39 billion ($691 million) for a 10.16 percent stake in Cathay, the companies said.
Air China controls China National Aviation Co. Ltd. (CNAC), which is the largest shareholder in unlisted Dragonair, owning 43 percent.
Cathay already held a 17.8 percent stake in Dragonair and Cathay's parent, Swire Pacific, had a separate 7.71 percent holding.
Cathay Pacific and Air China said they planned to set up a jointly owned cargo airline based in Shanghai, to be held 51 percent by Air China and 49 percent by Cathay. The companies also said Hong Kong Dragon Airlines, better known as Dragonair, would keep its current branding for six years.
Cathay has been frustrated by its limited access to mainland China, where its only passenger routes are to Beijing and Xiamen. Dragonair, which flies to 23 mainland cities including the lucrative Shanghai market, fills that gap in Cathay's network.
Cathay is buying the shares in Dragonair that it does not already own from Swire Pacific, as well as CITIC Pacific and CNAC, for HK$820 million in cash and the remainder in new Cathay shares issued at HK$13.50 each, a premium of 4.2 percent over their last closing price.
Air China is buying its shares in Cathay for HK$13.50 each from Swire and CITIC, the companies said. Cathay will pay HK$3.45 per share in Air China to double its holding in the carrier, a premium of 11.3 percent over the last close.
Cathay also said it would pay a special dividend of HK$0.32 per share on completion of the deal.
Shares in all five companies, which have been suspended since Monday morning, were to resume trading on Friday, the companies said.
The deal will see Swire's stake in Cathay pared from 46.3 percent to 40 percent, while CITIC Pacific's holding in Cathay will fall from 25.4 percent to 17.50 percent.

SMOC
9th Jun 2006, 08:10
I've said this on another post but somewhere in the press it says the KA brand will be kept for the next 6 years, and that's how long I think it will take for CX to repaint the KA fleet.

KA B744BCFs straight to CX Cargo as "Silver Bullets"

KA "Classic" Freighters to either that China Cargo tie up that was in the news recently or to CX Cargo as "Silver Bullets".

The big question will be will the KA Captains have to re-apply for their CX CMDs like the Air Hong Kong freight guys did. :eek:

Fly747
11th Jun 2006, 15:02
Any thoughts on how the two seniority lists might be combined? I guess they will be eventually.
How were the Air HK guys integrated?